Khosla on Capitalism and the Poor

The New York Times has an interesting article about the venture capitalist Vinod Khosla. Alas the paper characteristically trots out some "expert" employed by a non-profit (what would we do without experts?) to say that profits are bad:

Philanthropy experts say commercial companies play an important role in combating poverty by creating jobs. But they say these "social enterprises," as they are sometimes known, cannot be solely relied upon to address the many entrenched causes of poverty.

Moreover, as the fallout from the global financial crisis has made clear, the profit-maximizing tendencies of businesses can hurt society, said Phil Buchanan, president for the Center for Effective Philanthropy, a research organization based in Cambridge, Mass.

Nonprofits are effective because they can "take issue with the unbridled pursuit of profit at the expense of people's lives," Mr. Buchanan said. "I think some of that gets lost in all of the hype around social enterprise."

Mr. Khosla says that he is not completely opposed to charities — that his fund may even donate to some nonprofit entities. But he says he is generally skeptical that nongovernmental organizations can accomplish much because they tend to drift away from what their donors wanted them to do.

"I am relatively negative on most N.G.O.'s and their effectiveness," he said. "I am not negative on their intentions."